Fair Value Measurements

3 Months Ended

Mar. 31, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements

3. Fair Value Measurements

Financial assets and liabilities are recorded at fair value. We determine fair value using the fair value hierarchy, which establishes three levels of inputs that may be used to measure fair value, as follows:

Level 1 inputs include quoted prices in active markets for identical assets or liabilities.

Level 2 inputs include observable inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability.

Level 3 inputs include unobservable inputs that are supported by little or no market activity and are significant to the fair value of the underlying asset or liability. Such inputs reflect our best estimate of what market participants would use in pricing the asset or liability at the reporting date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires our management to make judgments and consider factors specific to the asset or liability.

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2020 and December 31, 2019 were as follows (in thousands):

	March 31, 2020
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents
Money market funds	$	54,841	$	—	$	—	$	54,841
Short-term marketable securities
Corporate commercial paper		—		93,347		—		93,347
Corporate debt securities		—		142,640		—		142,640
Government‑sponsored enterprise securities		—		16,055		—		16,055
Long-term marketable securities
Corporate debt securities		—		8,534		—		8,534
Government‑sponsored enterprise securities		—		21,111		—		21,111
Total	$	54,841	$	281,687	$	—	$	336,528

	December 31, 2019
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents
Money market funds	$	17,664	$	—	$	—	$	17,664
Corporate commercial paper		—		6,983		—		6,983
Corporate debt securities		—		10,204		—		10,204
Short-term marketable securities
Corporate commercial paper		—		95,088		—		95,088
Corporate debt securities		—		154,690		—		154,690
Government‑sponsored enterprise securities		—		26,265		—		26,265
Long-term marketable securities
Corporate debt securities		—		14,202		—		14,202
Government‑sponsored enterprise securities		—		38,055		—		38,055
Total	$	17,664	$	345,487	$	—	$	363,151

The carrying amounts of accounts payable and accrued liabilities approximate their fair values due to their short-term maturities. Our Level 2 securities are valued using third-party pricing sources. The pricing services utilize industry standard valuation models, including both income and market-based approaches, for which all significant inputs are observable, either directly or indirectly. There were no transfers of assets or liabilities between the fair value measurement levels during the three months ended March 31, 2020 and 2019.